Imagine your boss leaning against his desk. The warning is severe. If you don’t get this year’s new predictions right, you’re doomed. These numbers are more aggressive than what they have achieved in the last four years. The required speed is unprecedented in the last century.
Now imagine the automotive industry in that chair.
This is how the executives of major car manufacturers feel right now. The pressure rises. New federal fuel economy standards are forcing the industry to make a change that was never called for but can no longer be ignored.
Explanation of the 54.5 mpg rule
In July 2011, President Obama introduced new fuel economy standards. The goal is clear. Car manufacturers must increase efficiency by 5% per year. The average annual increase was slightly higher, 3.5%.
By 2025, the government wants to achieve an average vehicle mileage of 54.5 mpg over the test cycle. That’s equivalent to the 37 mpg listed on the actual window sticker that most buyers see in showrooms.
Mathematics is cruel. Since 2007, the industry’s efficiency has increased by slightly more than 2% per year on average. Closing that gap in just four years is a huge improvement. We must innovate at a rate that disrupts traditional vehicle development cycles.
Historically, automakers have hated such ideas. When a similar standard appeared in 2007, panic began. The costs of new technology may seem prohibitive. Progress looks like a money pit.
What made you change your mind? regulatory pressure.
Acceptance of federal funds forces automakers to soften their stance on the government. But it’s not just about compliance. The market has also changed. Over the past four years, small cars and fuel economy have gone from niche interest to mainstream demand. Buyers want it. Regulators require this. Industry must adapt.
Light materials and progressive additions
How can you squeeze more miles out of the gallon without reinventing the wheel? Start by making your car lighter.
Aluminum and other lightweight materials are becoming the standard in frame parts and frames. The manufacturing industry continues to work overtime to reduce the cost of these resources. Lighter cars consume less fuel. This is a simple physical equation that was eventually adopted by car manufacturers.
But not all solutions are attractive. Some efficiency gains are small. Almost invisible.
Small changes in tire pressure and composition. Low-friction lubricant in the engine. Aerodynamic refinements have been added to the exterior lines. These gradual changes add up. They manipulate fuel economy in small, measurable ways.
The problem is the magnitude of the benefits. A study by the University of Michigan highlighted an alarming reality. The increase from 18.4 mpg to 18.5 mpg represents a $500 difference in the manufacturer’s tax bill. What is the real fuel savings for the driver? Low.
We hunted less than a mile. But in the regulatory world, points matter.
Start-stop system and battery technology
One of the most powerful tools for improving efficiency is battery power. More specifically, it is an idle stop system.
These systems allow the engine to be turned off when the car is stopped at traffic lights. Electronic devices remain powered. The engine restarts as soon as you press the gas pedal.
Currently, only 2% of North American automakers’ vehicles are equipped with this technology. That number is about to change.
Johnson Controls, the Wisconsin-based manufacturer that makes a third of car batteries, has overhauled its factory. Next summer, the company is preparing to start manufacturing batteries exclusively for start-stop systems.
Will this save me money? Perhaps. Buying a typical family sedan can save you $100 a year. For most families, this is not a life-changing sum. But the cumulative effect of millions of cars is staggering.
Marc Clothier of Bloomberg Businessweek said that while individual savings may be small, the impact on the entire industry can be large. This is the low hanging fruit and the supply chain is finally ready to harvest.
Alternative fuel and electric vehicles
There is another method. Fuel changes.
Industry explores natural gas. ethanol. LPG. These alternative sources are researched and developed in laboratories and test tracks across the country.
Then there is the future of electricity. This is no longer the future. Here it is.
Tesla Roadster. Chevrolet Volt. Nissan Leaf. These vehicles run on electricity instead of gasoline. They are either fully electric or have significant electrical components.
Due to the strict fuel efficiency standards adopted worldwide, car manufacturers have few options. They must strive to adopt new technologies. They need to switch to cleaner fuel sources. They need to come up with designs that push boundaries.
Gone are the days when things were done the same way. The window is closed. These predictions are aggressive. The clock is ticking.
